Gordon Brown is set to usher in a new era of council housing by helping local authorities to buy repossessed and unsold properties. Cash and powers will be made available so that town halls can intervene in the housing market.
The measures – which could be announced as soon as Tuesday – will encourage councils and housing associations to offer struggling borrowers financial help in return for a stake in their homes or outright ownership. The number of council homes has plummeted since 1981 from 6.1 million to 2.5 million. Hundreds of millions of pounds of extra cash earmarked for social housing could now be released early to buy up newly built properties.
It is understood that town halls will also be encouraged to emulate Liverpool’s local authority, which offers first-time buyers help with deposits in return for a small equity stake. Other options, including a stamp duty holiday, are being held back for further consideration.